NASCAR’s charters reportedly around the big mark of $30 million

NASCAR: Cup Championship
Mark J. Rebilas-USA TODAY Sports

NASCAR introduced the charter system in 2016 as a total of 36 entries received a charter that guaranteed a spot in every Cup Series event, a fixed income on top of earned income, and governance.

Let’s dive into the latest surrounding NASCAR’s charter system as the sport has intentions to extend it far into the future.

NASCAR intends to continue the charter agreement beyond the 2024 season

NASCAR: Truck Series Championship
November 4, 2022; Avondale, Arizona, USA; NASCAR president Steve Phelps on the Camping World Truck Series grid prior to the Lucas Oil 150 Truck Series Championship at Phoenix Raceway. Mandatory Credit: Mark J. Rebilas-USA TODAY Sports

The last time NASCAR faced a situation when the charter agreement was set to expire, there was an agreement that saw it extended through the 2024 season. As the sport enters the 2023 season, it means the agreement will end soon.

According to Steve Phelps, the sport has intentions to renew the agreement as he believes the charter system is good for NASCAR. While Phelps said it is not perfect, he believes it has worked very well.

One of the downfalls of the charter system includes the number of owners who want to enter NASCAR’s top level but cannot find a way due to teams not wanting to let go of their charters.

JR Motorsports is one of those teams want to race in the NASCAR Cup Series; however, everything has not come together yet. The organization will not compete in the series for the 2023 season.

The finances are a part of the reason why JR Motorsports has not made the jump. However, with the latest report on how much charters are worth right now, it is very reasonable to understand why this is the case.

Related: JR Motorsports’ big and uncertain future in NASCAR

NASCAR’s charters are reportedly worth around $30 million right now

NASCAR: Cup Practice & Qualifying
July 16, 2022; Loudon, New Hampshire, USA; NASCAR Cup Series driver JJ Yeley (15) during practice for the Ambetter 301 at New Hampshire Motor Speedway. Mandatory Credit: Eric Canha-USA TODAY Sports

There was a time when NASCAR’s charters were worth roughly $20 million, but that number has reportedly taken a very massive jump as the TV deal continues to loom for the 2025 season and beyond.

According to Sports Business Journal’s Adam Stern on SiriusXM NASCAR Radiothe sport’s charters are likely not going for less than $30 million which has caused a standstill regarding the market.

This is what Stern had to say about the price of NASCAR’s charter system at this point in time.

“In terms of the price, you are not going to get one right now for less than $30 million, but people don’t want to spend $30 million right now, so things are at a standstill. There are not many teams who are willing to even part with charters and those who are, they basically want to bake in the idea that NASCAR is going to get more money in the next TV deal. They don’t want to give these away and then 6 months later, it becomes clear that they were worth a lot more money.”

Adam Stern on the price of acquiring a charter

There is no sugarcoating it that $30 million is a very shocking number when it comes to acquiring a charter. If this is the case, it makes sense why there have not been many charters being moved to other teams during the silly season process.

As stated by Phelps at the State of the Sport address, the price of charters is a significant multiple compared to what it was just three years ago. This certainly appears to be the case.

Stern continued by talking about the standoff that is currently strangling the charter market at the moment.

“There’s kind of a standoff right now between the people who are interested in buying and the people who are interested in selling. It’s not clear that they are worth $30 million, but to the people who are holding them, it’s not clear they are not worth $30 million. It’s kind of a little bit of standoff right now and that’s one of the reasons you haven’t really seen any charters change hands in the past year.”

Adam Stern on the standoff in the charter market

If the price of charters is $30 million, it might be smart to wait and see what happens. Obviously, it could end up backfiring, but teams do not want to lose money with the looming TV deal.

There is no reason to rush through any transaction when there is a clear bar set for the teams who are willing to sell. In all honesty, it is not a bad strategy for those holding them.

For now, it is a waiting game to see if anyone will bite around the $30 million mark. This could be a long process of figuring out the true value of a charter if not.

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